Tesla to Expand Car-Parts-Production Capacity in Shanghai

Electric-vehicle major Tesla plans to expand car-parts-production capacity in Shanghai, a media report says.
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Tesla  (TSLA) - Get Report is looking to boost its capacity to produce certain car parts at the electric-vehicle maker's $2 billion factory in Shanghai, a Tuesday media report said.

Tesla shares at last check were up about 5.8% to $643.06.

The Palo Alto, Calif., company plans to add lines to make more battery packs, electric motors, and motor controllers, Reuters reported, citing documents Tesla submitted to the Shanghai government.

Tesla started delivering Model 3 electric sedans from its Shanghai factory in December.

The documents indicate that Tesla wants to almost double its annual building capacity for cooling pipes, a key part in a car's heat-management system, to 260,000 sets a year from 150,000. It did not provide capacity details for other parts, Reuters said.

The planned production line will not include battery-cell manufacturing but will package outsourced battery cells at the plant.

The company is also building an additional stamping line to speed car production in Shanghai, Reuters said, referencing construction documents it had seen.

Tesla to looking to produce 150,000 Model 3 sedans and later hike output to 250,000 a year, including the Model Y compact crossover, according to a 2018 Shanghai government filing. The company aims to deliver more than 500,000 vehicles globally by year-end 2020.

The company's production and delivery plans in Shanghai have been disrupted by the coronavirus outbreak. 

Passenger-car retail sales in China plunged around 80% in February due to the epidemic.

Tesla did not immediately respond to a request for comment.

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